Patent Law

Shoe Shoo

By Gary Odom and Jordan Kuhn

DSW sued Shoe Pavilion for infringing 6,948,622 and D495,172, claiming a shoe display rack. Shoe Pavilion responded by removing the offending racks. The district court booted the case. The CAFC booted the district court, for importing a limitation into claims unjustifiably, and not properly awarding damages. Shoe Pavilion owed for the time it was infringing. "Because patent infringement is a strict liability offense, the nature of the offense is only relevant in determining whether enhanced damages are warranted."

DSW v. Shoe Pavilion (CAFC 2008-1085)

DSW owns the '622 patent, which teaches a system and method for storing and displaying a large stock of footwear for customer self-service. DSW also owns the '172 patent, which claims an ornamental design for a combined product display and stacked product container separator. On May 19, 2006, DSW notified Shoe Pavilion that the then-current shoe display design ("First Design") in five of its stores infringed DSW's '622 and '172 patents. Shoe Pavilion responded to the notice, and agreed to modify its First Design to avoid infringement. Within seven months of DSW's notification of infringement, Shoe Pavilion removed all First Design displays from its stores and replaced them with a modified design ("New Design").

On October 27, 2006, DSW filed suit against Shoe Pavilion for patent infringement, alleging that Shoe Pavilion's manufacture and use of its New Design footwear displays in seven of its California stores also infringed claims 4-6 of the '622 patent, and that Shoe Pavilion owed damages for infringement of the '172 and '622 patents by the First Design. Shoe Pavilion moved for summary judgment that its New Design footwear displays did not infringe, or, in the alternative, that the '622 patent is invalid, and that it owed no damages for infringement by the First Design.

There was a claim construction dispute, whether independent claim 4 and its dependents (5-6), inherently included a "track and roller mechanism" extant in independent claims 1-3. The district court had rolled the limitation in.

Relying on the specification and the prosecution history, the trial court agreed with Shoe Pavilion that method claims 4-6 were not independent and separately patentable from claims 1-3. Specifically, it found that (1) the examiner's reasons for allowance indicated that the Track and Roller Limitation was the seminal feature distinguishing the '622 patent over the prior art, (2) claims 4-6 would be invalid as indefinite without the limitation, and (3) the specification describes the invention as a modular footwear display and storage system, and claims 1-3 recite a footwear display and stack divider module connected by a module support member containing the Track and Roller Limitation. The court also noted that the preferred embodiment explicitly includes the Track and Roller Limitation.

Hence a non-infringement decision from the trial court.

The CAFC removed the thorn of erroneous importation of the "track and roller" limitation, leaving aside "whether the proper construction of the claim language renders the method claims at issue obvious."

First, absent contravening evidence from the specification or prosecution history, plain and unambiguous claim language controls the construction analysis. Northern Telecom Ltd. v. Samsung Elecs. Co., 215 F.3d 1281, 1295 (Fed. Cir. 2000) ("The plain and ordinary meaning of claim language controls, unless that meaning renders the claim unclear or is overcome by a special definition that appears in the intrinsic record with reasonable clarity and precision.") (citation omitted); see also Intervet Am., Inc. v. Kee-Vet Labs, Inc., 887 F.2d 1050, 1053 (Fed. Cir. 1989) ("[T]his court has consistently adhered to the proposition that courts cannot alter what the patentee has chosen to claim as his invention, that limitations appearing in the specification will not be read into claims, and that interpreting what is meant by a word in a claim 'is not to be confused with adding an extraneous limitation appearing in the specification, which is improper.'" (quoting E.I. Du Pont De Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1433 (Fed. Cir. 1988))). On its face, the "horizontally movably positionable stack divider" disputed language in claims 4-6 means that the vertically disposed stack dividers must be capable of being moved into different horizontal positions in the footwear display. Although broad, this claim language is not ambiguous. We therefore disagree with the trial court's decision to intermingle its validity and construction analyses and as a result read into claims 4-6 the Track and Roller Limitation of claims 1-3. See Phillips v. AWH Corp., 415 F.3d 1303, 1327 (Fed. Cir. 2005) (en banc) ("[W]e have limited the maxim [of construing a claim to preserve its validity] to cases in which 'the court concludes, after applying all the available tools of claim construction, that the claim is still ambiguous.'" (quoting Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 911 (Fed. Cir. 2004))).

Nothing in the prosecution history, including notice of allowance, suggested otherwise.

See Markman, 52 F.3d at 980 ("Although the prosecution history can and should be used to understand the language used in the claims, it too cannot 'enlarge, diminish, or vary' the limitations in the claims.") (citations omitted).

Further, there were alternate embodiments that didn't include the track and roller mechanism.

Moreover, when claim language is broader than the preferred embodiment, it is well-settled that claims are not to be confined to that embodiment. E.g., Phillips, 415 F.3d at 1323 ("[A]lthough the specification often describes very specific embodiments of the invention, we have repeatedly warned against confining the claims to those embodiments.").

No damages either.

With respect to damages, the district court found that DSW was not entitled to any damages as a matter of law, because immediately upon receipt of DSW's notice of infringement of the '172 and '622 patents by the First Design, Shoe Pavilion took reasonable steps and timely removed all of the infringing shoe displays. Citing Wine Railway, the trial court granted summary judgment to Shoe Pavilion and stated that no damages for infringement are recoverable by a plaintiff unless the infringing activity continues after notice is provided to the infringer.

Wine Railway applied to limited damages from no product marking.

The district court misapplied the standard expressed by the Supreme Court in Wine Railway, which held that under the predecessor statute to the notice provision of 35 U.S.C. § 287, a patentee who failed to mark his patented article with the appropriate patent number could only recover damages for infringement occurring after actual notice was provided the infringer. Wine Ry., 297 U.S. at 393-94. This court has applied Wine Railway in the current context of Section 287. Tex. Digital Sys., Inc. v. Telegenix, Inc., 308 F.3d 1193, 1219 (Fed. Cir. 2002). The purpose of the notice requirement is to provide "protection against deception by unmarked patented articles." Wine Ry., 297 U.S. at 398. The idea is to prevent innocent infringement. Motorola, Inc. v. United States, 729 F.2d 765, 772 (Fed. Cir. 1984).

Once on notice, on the hook.

Wine Railway provides no support for the trial court's summary judgment on damages. The issue here is whether Shoe Pavilion is liable for damages to DSW for infringement occurring subsequent to receipt of actual notice, and Wine Railway flatly states that a patentee may indeed recover damages for infringement that continues after actual notice is provided. Wine Ry., 297 U.S. at 393-94. Without a doubt, the law offers an infringer no exception to liability for the time it takes to terminate infringing activities, no matter how expeditious and reasonable its efforts. See In re Seagate Tech., Inc., 497 F.3d 1360, 1368 (Fed. Cir. 2007) (en banc) ("Because patent infringement is a strict liability offense, the nature of the offense is only relevant in determining whether enhanced damages are warranted."). The trial court therefore erred in concluding that Shoe Pavilion's reasonable steps and good faith efforts to bring its infringing activity to a timely end equated to an immediate cessation. Thus, if the patents at issue are valid, damages are owed on the design for the 6-7 months of continued infringement while Shoe Pavilion phased out use of the displays in its stores.

Vacated and remanded.

Full post as published by The Patent Prospector on August 22, 2008 (boomark / email).